Tags: tax investigation
This client was referred to us by a firm of accountants in North London. The client ran an Italian restaurant and had been subjected to a HMRC investigation for almost 3 years with tax assessments and penalties in excess of £130,000 (involving VAT, corporation tax and income tax). By the time the case came to us, it was fairly late as an appeal had been submitted to the First Tier Tax Tribunal and Statements of Case exchanged. When we reviewed the case and discussed the background with the client, we found there was new information that had not been made available to HMRC previously and could help close the matters outside of the court. After long negotiations, HMRC agreed to have an Alternate Dispute Resolution (ADR) meeting. At the ADR meeting, which went on for approximately 7 hours, we were able to put forward our case and convince HMRC that the assessments were excessive and unreasonable. HMRC officers understood the client’s position and finally agreed to reduce the liability to 10% of the original figure. This was a very big relief for our client as he was considering putting his company into liquidation and declaring bankruptcy. We are grateful to the HMRC officers for their professional behaviour and demonstrating their full commercial understanding in bringing this case to a closure.